Several years of wage restraint could promote militancy in public-sector unions
An uncertain economy, an interventionist federal government, an aging workforce and a pending shortage of skilled trades.
Together, these factors will make for challenging times at the negotiating table in the new year, according to the Conference Board of Canada’s recently released Industrial Relations Outlook 2012.
The report, written with input from unions and private-sector and public-sector employers, suggests that while a fragile economy will mute some labour demands, austerity measures in the public sector may increase tensions.
On the public-sector side, collective agreements covering almost 458,000 workers expire in 2012. The largest sectors include health care in B.C., Saskatchewan and Manitoba, as well as provincial government workers in all but Quebec and P.E.I.
Teachers will also be at the bargaining table in some of the country’s largest school boards, including Toronto, Calgary, and both Halton and Peel region in the Greater Toronto Area.
Given that wage gains have been relatively modest in recent years, money is the expected to be the dominant issue in 2012, according to the report.
“The public sector is a little later in collecting on the recession,” says Karla Thorpe, the Conference Board’s director of leadership and human resources research. She notes there have been wage freezes in several provinces over the past two years and those workers will be expecting more money regardless of the economic climate.
“There’s frustration because [workers] feel they weathered the toughest part of the recession,” she says. “By 2012 the economy should have been better, but it hasn’t worked out that way.”
In B.C., for example, the vast majority of public-sector workers have not seen a wage increase since 2009, according to David Vipond, director of negotiations and human resources with the B.C. Government Employees Union (BCGEU).
“If there is no mandate enabling fair settlements after two years of zero and cuts in employment, the response of public-sector unions is quite predictable — industrial action,” he writes in the report. “The BCGEU has a $40-million defence fund to spend, and it will spend it if necessary.”
While provinces such as Newfoundland and Labrador are faring better financially, in part because of offshore oil revenue and major mining projects, they’re facing pressure to pay down debt now in the event of a drop in oil production or no new natural resource finds.
Elsewhere, the Public Service Alliance of Canada (PSAC) will enter negotiations at a time when the federal government is looking to make 10 per cent cuts across the board, and after reaching a settlement last year that eliminated severance pay for employees upon termination.
“Given the current economic climate and anticipated bargaining agenda, reaching negotiated settlements will be increasingly difficult to achieve,” says Claude Tremblay, director general of workplace relations and compensation directorate at the Canada Revenue Agency.
At the municipal level, negotiations between the City of Toronto and its outside workers are already heating up with Mayor Rob Ford demanding a number of major concessions as he tries to reduce the city’s budget.
In the private sector, collective agreements covering nearly 99,000 private-sector workers will expire next year, notably within the Canadian Media Production Association and the Big Three automakers.
But the report’s authors suggest there are conciliatory signs on the private side.
Of note, the City of Windsor now boasts a two-year strike-free record in the private sector. During this time, the Canadian Auto Workers (CAW) has negotiated and ratified more than 100 contracts.
Elsewhere, unionized workers in the energy field can likely expect improvements to wages and benefits as employers compete for labour, while those in recovering industries — such as forestry — may be more focused on job security.
Overshadowing collective bargaining among all sectors are a number of issues, including a decline in union power, according to the report.
The study notes that unionized wage settlement increases have been generally lower than non-unionized wage increases, and barely kept pace with inflation since the 1980s.
Finally, Thorpe points to the federal government’s willingness to involve itself in collective bargaining disputes on the grounds of economic stability.
“That has implications for both sides,” she says. “It can make them more likely to be conciliatory so there’s no intervention or it causes them to be very firm.”
Next issue we’ll focus on the report’s analysis of how pensions, the aging workforce and the shortage of skilled labour will influence collective bargaining in 2012.
